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2018 DIGILAW 1814 (JHR)

National Insurance Co. Ltd. v. Geeta Burnwal

2018-08-09

RAJESH KUMAR

body2018
JUDGMENT Rajesh Kumar, J. - Heard learned counsel for the appellant, learned counsel for the respondent Nos. 1, 2 & 3 i.e. claimants and counsel appearing on behalf of the respondent Nos. 4 and 5 (owner and driver of offending vehicle). 2. The present appeal has been filed by the insurance company on very limited grounds. The only points taken by the insurance company with regard to issue no.6 which is quoted hereunder: "vi. Whether the vehicle No.JH-12A-7990 was plying on the road with valid permit at the time of alleged accident?" 3. The finding has been recorded by the Claim Tribunal in paragraph-21, which is quoted hereunder: "Issue No. VI- O.P. No.2 Rajnandan Ram and O.P. No.3 Rajendra Prasad Soni in their written statements have stated that the vehicle in question has all vehicular documents relating to the Mini Bus No. JH- 12A-7990 but he has not produced the permit of the said Mini Bus for plying on road. However, the O.P. No.1 National Insurance Co. Ltd. in his written statement has stated that the owner of the offending vehicle shall have to produce RC Book, tax token, road permit, driving licence and other vehicular document and in absence of these documents, this O.P. shall not liable to indemnify the loss if any. The O.P. Nos.2 and 3 has not produced any document to show that the Tata 407 City Ride Mini Bus No.JH- 12A-7990 was plying on the road with valid permits. Accordingly, this issue is decided in favour of the claimants and against the O.P. Nos. 2 and 3." 4. Learned counsel for the appellant submits that there is a specific finding returned by the Claim Tribunal that the offending vehicle in question was plying on the road without having any permit. This finding of fact has not been challenged either by owner of the offending vehicle or by the claimants. Insurance company has also accepted the finding, as such there is no dispute, so far as findings recorded by the Claim Tribunal that the offending vehicle in question was plying on the road without permit. 5. Learned counsel for the appellant has relied upon the judgment rendered by Apex Court reported in 2018 SCC 548 in the case of Amrit Paul Singh & Anr. v. TATA AIG General Insurance Co. Ltd. & Ors. 5. Learned counsel for the appellant has relied upon the judgment rendered by Apex Court reported in 2018 SCC 548 in the case of Amrit Paul Singh & Anr. v. TATA AIG General Insurance Co. Ltd. & Ors. from which paragraph 23 of the said judgment is quoted hereunder: In the case at hand, it is clearly demonstrable from the materials brought on record that the vehicle at the time of the accident did not have a permit. The appellants had taken the stand that the vehicle was not involved in the accident. That apart, they had not stated whether the vehicle had temporary permit or any other kind of permit. The exceptions that have been carved out under Section 66 of the Act, needless to emphasise, are to be pleaded and proved. The exceptions cannot be taken aid of in the course of an argument to seek absolution from liability. Use of a vehicle in a public place without a permit is a fundamental statutory infraction. We are disposed to think so in view of the series of exceptions carved out in Section 66. The said situations cannot be equated with absence of licence or a fake licence or a licence for different kind of vehicle, or, for that matter, violation of a condition of carrying more number of passengers. Therefore, the principles laid down in Swaran Singh (supra) and Lakhmi Chand (supra) in that regard would not be applicable to the case at hand. That apart, the insurer had taken the plea that the vehicle in question had no permit. It does not require the wisdom of the "Tripitaka", that the existence of a permit of any nature is a matter of documentary evidence. Nothing has been brought on record by the insured to prove that he had a permit of the vehicle. In such a situation, the onus cannot be cast on the insurer. Therefore, the tribunal as well as the High Court had directed the insurer was required to pay the compensation amount to the claimants with interest with the stipulation that the insurer shall be entitled to recover the same from the owner and the driver. The said directions are in consonance with the principles stated in Swaran Singh (supra) and other cases pertaining to pay and recover principle. 6. The said directions are in consonance with the principles stated in Swaran Singh (supra) and other cases pertaining to pay and recover principle. 6. Learned counsel for the appellant has relied by Section 2(31) and Section 66 of the Motor Vehicle Act, 1988 which is quoted hereunder: Section 2 (31)- "permit" means a permit issued by a State or Regional Transport Authority or an authority prescribed in this behalf under this Act authorizing the use of a motor vehicle as a transport vehicle; Section 66- Necessity for permits.- (1) No owner of a motor vehicle shall use or permit the use of the vehicle as a transport vehicle in any public place whether or not such vehicle is actually carrying any passengers or goods save in accordance with the conditions of a permit granted or countersigned by a Regional or State Transport Authority or any prescribed authority authorising him the use of the vehicle in that place in the manner in which the vehicle is being used: Provided that a stage carriage permit shall, subject to any conditions that may be specified in the permit, authorise the use of the vehicle as a contract carriage: Provided further that a stage carriage permit may, subject to any conditions that may be specified in the permit, authorise the use of the vehicle as a goods carriage either when carrying passengers or not: Provided also that a goods carriage permit shall, subject to any conditions that may be specified in the permit, authorise the holder to use the vehicle for the carriage of goods for or in connection with a trade or business carried on by him. (2) The holder of a goods carriage permit may use the vehicle, for the drawing of any trailer or semi-trailer not owned by him, subject to such conditions as may be prescribed: 1[Provided that the holder of a permit of any articulated vehicle may use the prime-mover of that articulated vehicle for any other semitrailor.] (3) The provisions of sub-section (1) shall not apply- (a) to any transport vehicle owned by the Central Government or a State Government and used for Government purposes unconnected with any commercial enterprise; (b) to any transport vehicle owned by a local authority or by a person acting under contract with a local authority and used solely for road cleansing, road watering or conservancy purposes; (c) to any transport vehicle used solely for police, fire brigade or ambulance purposes; (d) to any transport vehicle used solely for the conveyance of corpses and the mourners accompanying the corpses; (e) to any transport vehicle used for towing a disabled vehicle or for removing goods from a disabled vehicle to a place of safety; (f) to any transport vehicle used for any other public purpose as may be prescribed by the State Government in this behalf; (g) to any transport vehicle used by a person who manufactures or deals in motor vehicles or builds bodies for attachment to chassis, solely for such purposes and in accordance with such conditions as the Central Government may, by notification in the Official Gazette, specify in this behalf; 2[***] (1) to any goods vehicle, the gross vehicle weight of which does not exceed 3,000 kilograms; (j) subject to such conditions as the Central Government may, by notification in the Official Gazette, specify, to any transport vehicle purchased in one State and proceeding to a place, situated in that State or in any other State, without carrying any passenger or goods; (k) to any transport vehicle which has been temporarily registered under section 43 while proceeding empty to any place for the purpose of registration of the vehicle; 3[***] (m) to any transport vehicle which, owing to flood, earthquake or any other natural calamity, obstruction on road, or unforeseen circumstances, is required to be diverted through any other route, whether within or outside the State, with a view to enabling it to reach its destination; (n) to any transport vehicle used for such purposes as the Central or State Government may, by order, specify; (o) to any transport vehicle which is subject to a hire-purchase, lease or hypothecation agreement and which owing to the default of the owner has been taken possession of by or on behalf of the person with whom the owner has entered into such agreement, to enable such motor vehicle to reach its destination; or (p) to any transport vehicle while proceeding empty to any place for purpose of repair. (4) Subject to the provisions of sub-section (3), sub-section (1) shall, if the State Government by rule made under section 96 so prescribes, apply to any motor vehicle adapted to carry more than nine persons excluding the driver. 7. Learned counsel for the appellant further submit that since offending vehicle in question was plying without permit and as such as per the mandate of Section 149 (2) of Motor Vehicle Act, 1988, the insurance company is not liable to make payment rather it is the liability of the owner of the offending vehicle. 8. Section 149(2) of Motor Vehicle Act, 1988 is quoted hereunder: (2) No sum shall be payable by an insurer under subsection (1) in respect of any judgment or award unless, before the commencement of the proceedings in which the judgment or award is given the insurer had notice through the Court or, as the case may be, the Claims Tribunal of the bringing of the proceedings, or in respect of such judgment or award so long as execution is stayed thereon pending an appeal; and an insurer to whom notice of the bringing of any such proceedings is so given shall be entitled to be made a party thereto and to defend the action on any of the following grounds, namely:- (a) that there has been a breach of a specified condition of the policy, being one of the following conditions, namely:-(i) a condition excluding the use of the vehicle- (a) for hire or reward, where the vehicle is on the date of the contract of insurance a vehicle not covered by a permit to ply for hire or reward, or (b) for organised racing and speed testing, or (c) for a purpose not allowed by the permit under which the vehicle is used, where the vehicle is a transport vehicle, or (d) without side-car being attached where the vehicle is a motor cycle; or 9. The Apex Court has specifically held that the insurance company can avoid its liability only on the basis of statutory limitation provided under Section 149(2) of Motor Vehicle Act, 1988 and not on the basis of insurance policy. 10. The Apex Court has specifically held that the insurance company can avoid its liability only on the basis of statutory limitation provided under Section 149(2) of Motor Vehicle Act, 1988 and not on the basis of insurance policy. 10. It has been further held that only violation of condition of Section 149(2) of Motor Vehicle Act, 1988 is not enough to avoid its liability rather it has to be seen that the owner was not sufficiently vigilant in observing the terms and conditions of the insurance policy. In fact, in the catena of decisions rendered by the Apex Court, it is clear that to avoid liability by the insurer, it has to be proved that insured was negligent in plying the vehicle and has not taken sufficient precaution and on that basis only the liability can be avoided. 11. Law is clear that no vehicle can ply on road without having valid permit. To avoid liability, the onus lies upon the insurance company to plead and discharge its initial liability to prove that the condition of Section 149 (2) has been violated. 12. Once the defence has been taken by the insurance company regarding no permit and issue has also been framed by the Claim Tribunal, then onus shifts upon the owner of the offending vehicle, who has to plead and prove by bringing on record the relevant documents. If, specific plea has been taken by the insurance company that there was no valid permit, then onus shifts upon the owner of the offending vehicle and he has to bring on record the permit and if permit is not brought on record then, adverse inference can be drawn against the owner of the offending vehicle. 13. Admittedly, in present case, neither pleading nor assertion has been made by the owner of the offending vehicle i.e. O.P. No.2, that he was having a valid permit. 14. Since it is a negligent act on the part of the owner of the offending vehicle that he has allowed his vehicle to ply on the road without having permit, insurance company is well within his right to avoid its liability by taking shelter of Section 149 (2) of M.V. Act. 15. 14. Since it is a negligent act on the part of the owner of the offending vehicle that he has allowed his vehicle to ply on the road without having permit, insurance company is well within his right to avoid its liability by taking shelter of Section 149 (2) of M.V. Act. 15. Coming to the fact of the present case, it is admitted fact, that the vehicle in question was plying on the road without having valid permit and as such owner of the vehicle is liable and to that extent, the findings recorded by the Claim Tribunal is hereby reversed to this extent. 16. It is held that owner of the offending vehicle is liable to pay compensation to the claimant. Accordingly, the present misc. appeal is allowed. 17. Appellant is permitted to withdraw the statutory amount.